Tax Justice: A Christian (Presbyterian) Response to a New Gilded Age

Recommendations for the U.S. Presbyterian Church’s 221st General Assembly (2014):

It is a basic mark of a healthy social covenant that all share in the society’s benefits and burdens. Just taxation is a foundational part of a moral society’s answer to poverty and its close relatives, inequality, economic insecurity, and social immobility. Just taxation is also a key tool for enabling communities to thrive, for advancing science and culture, and for sustaining democratic institutions. Each citizen has an affirmative duty to contribute to the common good by paying their fair share of taxes.

What this highlights is that tax justice is a generic way of framing these issues: the general arguments almost make themselves. The article continues, very much echoing our point of view, but taking a U.S. perspective:

“The church’s moral claim recognizes the reality that even the greatest individual and corporate fortunes depend on the shared goods of physical and institutional infrastructure, governance, social peace, and intellectual capital built up over years of civilization. Morality, and particularly the morality that we as a society adopt through our political choices, is indeed at the heart of the problem of tax justice. We as a society are tolerating immoral tax laws when we allow tax minimization strategies, whether individual or corporate, to shift payment for these shared goods to those who have less ability to underwrite the costs and to share in the benefits.

The impact of inequality in America today is undeniable, prompting many comparisons with the first Gilded Age a century ago, when the permanent graduated income tax was put in place. Progressive taxation alone cannot rectify the imbalance that puts 35.6 percent of total U.S. wealth in the hands of one percent of the population, almost as much as the 36.6 percent held by the lower 95 percent, even in the recession year of 2009. Yet fair taxation is a key part of providing adequate revenue for government and, indeed, for maintaining public investment, social mobility, and equitable public policies.

The recommendations in this report seek to make the U.S. tax system fairer, calling it to be:

•      more progressive, taxing those with greater wealth at higher proportions of their income, wealth, and inheritance;

•      more transparent, which includes both simplicity and accountability for all tax preferences and tax expenditures;

•      more solidarity-focused, which means reducing the use of tax expenditures, shelters and havens, and supporting more adequate international standards to reduce tax competition within and among nations;

•      more sustainable for current and future generations, which means avoiding unproductive financial and ecological indebtedness; and

•      more adequate, effectively addressing broader objectives of economic and social health than efficiency alone, such as meaningful employment, improved family life, and restored public trust. The tax system must be characterized by both efficiency in tax collection and revenue sufficient for the common good.

Enough said. Tax Justice is for everyone. The recommendations, it seems, were approved, though not without some dissent.

With a big hat tip to Jim Henry.